California Civil Jury Instructions (CACI) (2017)

4524. Contractor’s Claim for Compensation Due Under Contract—Substantial Perfor- mance

Download PDF
4524.Contractor’s Claim for Compensation Due Under
Contract—Substantial Performance
[Name of defendant] claims that [name of plaintiff] did not fully perform
all of the things that [he/she/it] was required to do under the [terms of
the contract/plans and specifications], and therefore [name of defendant]
did not have to [specify owner’s obligations under the contract, e.g., pay
the contract balance]. [Name of plaintiff] claims that [he/she/it] did
substantially all of the things required of [him/her/it] under the
contract.
To succeed, [name of plaintiff] must prove all of the following:
1. That [name of plaintiff] made a good-faith effort to comply with
the terms of the contract and did not willfully depart from them;
2. That [name of plaintiff] did not omit any essential requirement in
the contract; and
3. That the [name of defendant] received essentially what the
contract called for because [name of plaintiff]’s failures, if any,
were so trivial that they could have been easily fixed.
If you find that [name of plaintiff] substantially performed the contract,
the cost of completing unfinished work must be deducted from the
contract price.
New December 2010
Directions for Use
This instruction is a variation of CACI No. 312, Substantial Performance. It should
be used if the issue is whether the contractor performed all of the requirements of
the construction contract, including the plans and specifications. If the owner
withholds some or all of the contract price because it claims that the contractor did
not perform the work completely or correctly, the contractor may assert that it
“substantially performed.”
Sources and Authority
• “ ‘At common law, recovery under a contract for work done was dependent
upon complete performance, although hardship might be avoided by permitting
recovery in quantum meruit. The prevailing doctrine today, which finds its
application chiefly in building contracts, is that substantial performance is
sufficient, and justifies an action on the contract, although the other party is
entitled to a reduction in the amount called for by the contract, to compensate
for the defects. What constitutes substantial performance is a question of fact,
but it is essential that there be no wilful departure from the terms of the
1147
0035
contract, and that the defects be such as may be easily remedied or
compensated, so that the promisee may get practically what the contract calls
for.’ ” (Posner v. Grunwald-Marx, Inc. (1961) 56 Cal.2d 169, 186–187 [14
Cal.Rptr. 297, 363 P.2d 313], original italics, internal citation omitted.)
• “ ‘Substantial performance means that there has been no willful departure from
the terms of the contract, and no omission of any of its essential parts, and that
the contractor has in good faith performed all of its substantive terms. If so, he
will not be held to have forfeited his right to a recovery by reason of trivial
defects or imperfections in the work performed.’ ” (Connell v. Higgins (1915)
170 Cal. 541, 556 [150 P. 769], internal citation omitted.)
• “What constitutes ‘substantial performance’ ‘is always a question of fact, a
matter of degree, a question that must be determined relatively to all the other
complex factors that exist in every instance.’ ” (Tolstoy Constr. Co. v. Minter
(1978) 78 Cal.App.3d 665, 672 [143 Cal.Rptr. 570], internal citation omitted.)
• “ ‘Whether, in any case, such defects or omissions are substantial, or merely
unimportant mistakes that have been or may be corrected, is generally a
question of fact.’ ” (Connell,supra, 170 Cal. at pp. 556–557, internal citation
omitted.)
• “ ‘The general rule on the subject of [contractual] performance is that “[w]here
a person agrees to do a thing for another for a specified sum of money to be
paid on full performance, he is not entitled to any part of the sum until he has
himself done the thing he agreed to do, unless full performance has been
excused, prevented, or delayed by the act of the other party, or by operation of
law, or by the act of God or the public enemy.” [Citation.] . . . [I]t is settled,
especially in the case of building contracts where the owner has taken
possession of the building and is enjoying the fruits of the contractor’s work in
the performance of the contract, that if there has been a substantial performance
thereof by the contractor in good faith, where the failure to make full
performance can be compensated in damages to be deducted from the price or
allowed as a counterclaim, and the omissions and deviations were not willful or
fraudulent and do not substantially affect the usefulness of the building for the
purposes for which it was intended, the contractor may, in an action upon the
contract, recover the amount unpaid of his contract price, less the amount
allowed as damages for the failure in strict performance. [Citations.]’ ”
(Murray’s Iron Works, Inc. v. Boyce (2008) 158 Cal.App.4th 1279, 1291–1292
[71 Cal.Rptr.3d 317].)
• “ ‘[T]here is a substantial performance where the variance from the
specifications of the contract does not impair the building or structure as a
whole, and where after it is erected the building is actually used for the
intended purpose, or where the defects can be remedied without great
expenditure and without material damage to other parts of the structure, but that
the defects must not run through the whole work so that the object of the owner
in having the work done in a particular way is not accomplished, or be such
that a new contract is not substituted for the original one, nor be so substantial
CACI No. 4524 CONSTRUCTION LAW
1148
0036
as not to be capable of a remedy and the allowance out of the contract price
will not give the owner essentially what he contracted for.’ ” (Murray’s Iron
Works, Inc.,supra, 158 Cal.App.4th at p. 1292.)
• “The rule of substantial performance was intended to cover situations where the
defects are slight or trivial, or where the imperfections do not affect a
substantive part of the work, but it was not intended to cover cases where the
departures or deviations from the plans are major, where it takes a major
operation to remedy the defects, or where the work as constructed is of no real
value.” (Bause v. Anthony Pools, Inc. (1962) 205 Cal.App.2d 606, 613 [23
Cal.Rptr. 265].)
• “[A]lthough in a few minor and trivial matters the building did not strictly and
technically comply with the terms of the contract, the departure was not willful
nor intentional on the part of the defendant, and the defects were capable of
being easily remedied to conform to the terms of the contract . . . . Thereupon
the court concluded that the defendant was entitled to have the contract
enforced in his favor, with an abatement . . . on the contract price on account
of the defects found to exist . . . .” (Rischard v. Miller (1920) 182 Cal. 351,
352–353 [188 P. 50].)
• “[The] performance rendered may be held to be less than substantial by reason
of the accumulation of many defects, any one of which standing alone would be
minor in character.’ ” (Tolstoy Constr. Co.,supra, 78 Cal.App.3d at p. 673,
footnote omitted.)
Secondary Sources
1 Witkin, Summary of California Law (10th ed. 2005) Contracts, §§ 818–819
1California Construction Contracts, Defects, and Litigation (Cont.Ed.Bar) Ch. 5,
Private Contracts: Disputes and Remedies, § 5.99
13 California Forms of Pleadings and Practice, Ch. 140, Contracts, § 140.23
(Matthew Bender)
5 California Points and Authorities, Ch. 50, Contracts, §§ 50.30, 50.31 (Matthew
Bender)
27 California Legal Forms, Ch. 75, Formation of Contracts and Standard
Contractual Provisions, § 75.230 (Matthew Bender)
2 Matthew Bender Practice Guide: California Contract Litigation, Ch. 22, Suing or
Defending Action for Breach of Contract, 22.08[2], 22.16[2], 22.37, 22.69
10 Miller & Starr, California Real Estate (Thomson Reuters West 3d ed.) Ch. 27,
Construction Law and Contracting, § 27:103
11 Miller & Starr, California Real Estate (Thomson Reuters West 3d ed.) Ch. 29,
Defective Construction, § 29:3
Acret, California Construction Law Manual (Thomson Reuters West 6th ed. 2005)
Ch. 1, Contracts, § 1:54
CONSTRUCTION LAW CACI No. 4524
1149
0037
5 Bruner & O’Connor on Construction Law (Thomson Reuters West 2002) Ch. 18,
Contract Breach & Termination, § 18:12
4525–4529. Reserved for Future Use
CACI No. 4524 CONSTRUCTION LAW
1150
0038